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Growth Hacking is a term coined by Sean Ellis to refer to the practice of agile growth methods that help a business grow faster and retain customers. Such practices and processes to supercharge growth were used by companies such as Airbnb, Facebook and Amazon to get to where they are now, using low-cost strategies that helped them expand.
One of the best examples is Dropbox. When Dropbox was starting out, it certainly wasn’t the only cloud-based software and it was difficult for it to win new customers. Once the company introduced its referral system in which it offered more cloud space to customers who shared a referral link with their friends, or gave them other rewards, its customer base grew exponentially.
Another good example is Airbnb, which in tackling the USmarket decided to allow its users to also share their homes on Craigslist. As Craigslist was one of the websites most used for sharing and renting houses, Airbnb was able to get noticed and attract more users to its platform.
Both these examples seem very simple and easy to put into practice. However, in both cases it took some time to arrive at these ideas and for them to be successful. Also, it is good to bear in mind how counterintuitive both these examples are. In the case of Dropbox, the company was losing money and needed more clients and the solution was actually to give away more space to clients for free. As for Airbnb, it wanted to entice customers onto the platform and ended up allowing users to share the property on the competition’s website, which was pretty risky but worked.
For sure, both these brands had previously tried different hacks that were just not as successful but by implementing low-cost, agile processes they were able to test out multiple options and see which ones worked best.
Although I am very interested in Growth Hacking and have read a lot about this topic and done my research, I am no specialist. So I decided to ask Rui Vasconcelos, advertio’s Head of Growth, for a few simple tips for anyone considering hiring a growth specialist or themselves wanting to try out growth hacking techniques.
You can’t solve a problem before you identify it! That is why Steve Blank’s urge you to “Get out of the building” makes so much sense.
You really need to meet your customers regularly, make sure that their pains and your value proposition are aligned, and that they understand your message. Find the small number of customers who need your product so much that they will buy it even if it is ugly and crashes at times. Once you find these heroes, you are on the right track! You are then the proud owner of a product that fits a need.
You cannot improve something you do not measure and there are so many variables that following your intuition is simply not enough. You need data-based decisions! Tracking your customer behaviour is key to pinpointing why your retention rate is low or where it is that your customers simply get confused. Identify the points of friction in your product and manage users’ expectations.
Every property of your business is a hypothesis to be tested. Whether it is your business model, customer archetype, value proposition, pricing or customer journey, everything needs a test.
Reid Hoffman’s definition of Blitzscaling is “prioritizing speed over efficiency in an environment of uncertainty” and we couldn’t agree more that setting the right priorities is key.
As a business is scaling up, inefficiencies creep in as the team gets bigger and the product more complex, and more customers arrive with need for support. Fires, fires, fires… See the big picture, and don’t lose precious time!
Do you need help with your growth strategy? Let us know!